Canada not mak­ing con­ces­sions needed for a NAFTA deal, says U.S.

Canada is not mak­ing con­ces­sions needed to reach a deal with the United States for a tri­lat­eral NAFTA pact and is run­ning out of time be­fore Washington pro­ceeds with a Mex­ico-only agree­ment, a top U.S. of­fi­cial said on Tues­day. The ad­min­is­tra­tion of Pres­i­dent Don­ald Trump has re­cently started in­creas­ing the pres­sure on Canada, urg­ing it to con­clude a deal by Sept. 30 or face ex­clu­sion from a re­vised North Amer­i­can Free Trade Agree­ment. U.S. Trade Rep­re­sen­ta­tive Robert Lighthizer said there was some “dis­tance” be­tween the two sides on is­sues such as ac­cess to Canada’s dairy mar­ket and how best to set­tle trade dis­putes. “The fact is, Canada is not mak­ing con­ces­sions in ar­eas where we think they’re es­sen­tial,” Lighthizer said at the Con­cor­dia Sum­mit in New York. “We’re go­ing to go ahead with Mex­ico. If Canada comes along now, that would be the best. If Canada comes along later, then that’s what will hap­pen. “We’re sort of run­ning out of time.” Trump has de­manded ma­jor changes to NAFTA, which he says caused U.S. man­u­fac­tur­ing jobs to move to low-wage Mex­ico. Mar­kets are ner­vous about the im­pact on a deal that un­der­pins $1.2 tril­lion in an­nual trade. Cana­dian of­fi­cials say that de­spite the U.S. threats to go it alone with Mex­ico, they do not be­lieve Trump can by him­self turn the 1994 pact into a bi­lat­eral deal. U.S. busi­ness groups, alarmed by the po­ten­tial dis­rup­tion to the three in­creas­ingly in­te­grated economies, have lob­bied the White House to keep NAFTA as a tri­lat­eral deal. The of­fice of Cana­dian For­eign Min­is­ter Chrys­tia Free­land, who sits op­po­site Lighthizer at the ne­go­ti­a­tions, did not re­spond to a re­quest for com­ment. The two are in New York for a UN meet­ing but it is un­clear whether they will meet. Prime Min­is­ter Justin Trudeau spoke be­fore Lighthizer at an event hosted by the Coun­cil on For­eign Re­la­tions in New York and took a more cau­tious tone about the out­come. “They (the United States and Mex­ico) made cer­tain agree­ments,” he said. “I think there’s a pos­si­bil­ity there to build on what they agreed.” The Trump ad­min­is­tra­tion says the text of a deal is needed by Satur­day to al­low the Mex­i­can gov­ern­ment to sign it be­fore leav­ing of­fice on Nov 30. “With Mex­ico, we’re not go­ing to say ‘no deal’ be­cause of Canada,” Lighthizer said. “That doesn’t make any sense at all, so hope­fully we’ll end up with some­thing with Canada.” Canada also has made clear the United States needs to with­draw Trump’s threat of a 25 per cent tar­iff on au­tos for a deal to be pos­si­ble. The United States, cit­ing se­cu­rity rea­sons, im­posed tar­iffs on Cana­dian steel and alu­minum in late May. Lighthizer said those tar­iffs would be ad­dressed once NAFTA had been com­pleted.